The CEO of JSR, one of the world’s largest suppliers of a material important for semiconductor production, has said that the lack of industrial infrastructure will make it “very difficult” for China to develop advanced chip manufacturing technology despite a push for self-sufficiency .
Eric Johnson, a rare American leader in a Japanese semiconductor company, also said in an interview that he expected bottlenecks in the chip sector to continue into 2023.
U.S. export restrictions on technologies required to manufacture the most advanced chips have prompted China to invest heavily to develop its own semiconductor supply chain.
But Johnson said China would fight to master the sophisticated chip-making technology based on a technique known as extreme ultraviolet or EUV lithography.
“I think China would also love to develop their own EUV competence, their ecosystem for these things. I think it’s going to be very difficult for them to do that, honestly,” Johnson said.
Semiconductors, which are essential for products from smartphones to washing machines, have become a focus of competition between Washington and Beijing. Joe Biden began his first trip to Asia as US president on Friday by visiting a Samsung chip factory in South Korea and emphasizing his desire to secure semiconductor supply chains.
EUV lithography is a very demanding process that uses light to etch small integrated circuits on silicon wafers.
Even if China “got a paper on exactly what the chemicals were… It’s really hard to produce it with purity, precision and reproducibility,” Johnson said. that.”
Tokyo-based JSR is a leading provider of photoresist, thin layers of material used to transfer circuit patterns to semiconductor wafers. Analysts say it has about 30-40 percent of the global market for photoresists used to make advanced chips, and counts Samsung, Taiwan’s TSMC and Intel in the United States among its customers.
China is the world’s largest importer of chips and has invested heavily in semiconductor initiatives as part of its “Made in China 2025”, which requires 70 percent self-sufficiency in key critical technology components by 2025.
But Johnson said “leading capacity takes decades and a lot of money to develop… You really need applications like the iPhone to pay for things”.
Still, Johnson stressed that Beijing was aggressively investing in less advanced chip-making technologies, which were also important, and that China was a big part of the JSR’s growth strategy.
He said he wanted to balance being able to “respectfully” and “responsibly” serve customers in China with “sensitivity to the concerns of the US government and concerns of protecting interests in Japan”.
“It’s underestimated how many opportunities there are in China that are not dependent on these very leading capabilities,” he said.
Johnson said bottlenecks in global chip supplies that have undermined the global economy will take until next year to resolve.
“It just takes time to bring new capacity online, and the new capacity will not really start to make an impact, probably until the end of this year or next year,” Johnson said.
He said he expected it would be particularly “problematic” for the sector to meet the demand for semiconductors used in vehicles, as they used less advanced chips, which were less profitable and therefore attracted less investment.